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Identity theft can manifest in various ways, from unauthorized credit card usage to fraudulent student loans. Thieves can open different forms of credit under your name, potentially wreaking havoc on your credit history and financial standing.
When faced with this distressing situation, it’s crucial to act swiftly to mitigate further damage to your credit. Here are essential steps to protect yourself and eliminate fraudulent accounts.
1. File a Police Report
Your first step should be to file a police report with your local police department. Many jurisdictions allow you to do this online. A police report is often required by lenders to remove fraudulent loans from your account. (See also: 9 Signs Your Identity Was Stolen)
2. Contact the Lender
If a loan or credit card has been fraudulently opened in your name, reach out directly to the lender or credit card company. Notify them of the fraudulent account and request its removal from your credit report. Generally, issues with credit cards and personal loans can be resolved quickly.
However, student loans can have severe repercussions for victims. Defaulting on a student loan may lead to wage garnishment, a suspended license, or the government seizing your tax refund. Therefore, it’s vital to address any fraudulent activity immediately and seek loan discharge.
For student loans, contact the lender and provide them with a police report. They will also require you to complete an identity theft report. While your discharge application is under review, you won’t be held responsible for payments.
For private student loans, the process is similar, but each lender has its own procedures. Typically, you will need to submit a police report, and the lender will conduct an investigation.
3. Notify the School, if Necessary
If student loans were taken out in your name, contact the school involved. Reach out to their financial aid or registrar’s office and explain the situation. They can flag the account in their system to prevent further loans from being issued under your name. (See also: How to Protect Your Child From Identity Theft)
4. Dispute Errors with Credit Bureaus
Upon discovering fraudulent activity, dispute the errors with the three major credit reporting agencies: Experian, Equifax, and TransUnion. Contact each agency and submit evidence, such as your police report or a letter from the lender acknowledging the identity theft. Once they receive this information, they can remove the fraudulent accounts from your credit history.
If your credit score has suffered due to these fraudulent loans, removing them can help improve your score. While it may take weeks or even months for your score to fully recover, it will eventually return to its previous level. (See also: Don’t Panic: Do This If Your Identity Gets Stolen)
5. Place a Fraud Alert or Freeze on Your Credit Report
As soon as you realize you’re a victim of identity theft, place a fraud alert on your credit report with one of the three credit reporting agencies. This can be done online:
By placing a fraud alert, potential creditors will be notified when they check your credit, prompting them to take extra steps to verify your identity before issuing any new credit. (See also: How to Get a Free Fraud Alert on Your Credit Report)
In some cases, you may want to freeze your credit. A credit freeze prevents creditors from accessing your credit report or issuing new credit until you lift the freeze.
6. Check Your Credit Report Regularly
Finally, make it a habit to check your credit report regularly to ensure no new accounts have been opened in your name. You can request a free report from each of the three credit reporting agencies once a year at AnnualCreditReport.com. Staggering your requests every four months allows you to monitor account activity throughout the year. (See also: How to Read a Credit Report)
